Monday, November 10, 2008

How Much of the Bailout Money Will Make it into the System?

We've already detailed how Goldman is expected to pay bonuses in excess of the $10 billion equity injection provided by the Treasury. Now, according to Alternet, of the $125B paid to the largest 9 recipients of the bailout to date, only $17B is projected to remain at the institutions:

It turns out that the nine banks about to be getting a total equity capital injection of $125 billion, courtesy of Phase I of The Bailout Plan, had reserved $108 billion during the first nine months of 2008 in order to pay for compensation and bonuses.

Paying Wall Street bonuses was not supposed to be part of the plan. At least that's how Federal Reserve Chairman Ben Bernanke and Treasury Secretary Hank Paulson explained it to Congress and the American people.